Report No. WT 99-4 WIRELESS TELECOMMUNICATIONS ACTION February 12, 1999
FCC GRANTS TRANSFER OF LICENSES FROM THE PUERTO RICO TELEPHONE COMPANY TO
GTE HOLDINGS
Today, the Commission adopted a Memorandum Opinion and Order (Order) granting
the transfer of control of licenses and an international resale authorization
held by Puerto Rico Telephone Company (PRTC) and Telefonica de Puerto Rico,
Inc. (TPRI) from the Puerto Rico Telephone Authority (PRTA) to GTE Holdings
(Puerto Rico) LLC (GTE Holdings). This transfer of control will occur as
part of a transaction in which GTE Holdings will purchase from PRTA a major
ownership interest in PRTC and will obtain de facto control over PRTC. After
considering all of the issues raised by commenters in this proceeding, the
Commission concluded that the proposed transfer of control is in the public
interest.
The Order granted the applications filed by PRTA and GTE Holdings pursuant to
sections 214 and 310(d) of the Communications Act of 1934, as amended, for
approval to transfer control of certain wireless telecommunications licenses
and an authorization to provide international resale service from PRTA's
wholly-owned subsidiaries, PRTC and TPRI, to GTE Holdings, which is a
wholly-owned subsidiary of GTE Corporation. In accordance with the terms of
sections 214(a) and 310(d), the Commission cannot grant such applications
unless the applicants demonstrate that the transfer of the subject licenses
and authorization will serve the public interest, convenience, and necessity.
In evaluating whether the proposed transaction would be in the public
interest, the Commission weighed the potential public interest harms of the
transaction against the potential public interest benefits, including an
evaluation of the possible competitive effects of the transfer.
The Commission concluded that the transaction is unlikely to produce
competitive harms in Puerto Rican telecommunications markets because existing
Commission rules, in combination with the continued application of access and
reporting conditions that had previously been imposed on PRTC, are adequate
to prevent anticompetitive activity.
The Commission also found that the transfer will result in significant public
interest benefits. In particular, telecommunications consumers will benefit
from private ownership of the island's principal local exchange service
provider by a well-financed and experienced company. GTE Holdings'
commitments to invest substantial sums in infrastructure improvements and
improve service quality are in the public interest. The Commission stated
these improvements are specifically attributable to GTE Holdings' purchase of
PRTC because the record does not demonstrate that such upgrades would have
occurred absent the merger.
Finally, the Commission stated the public could benefit from GTE Holdings'
commitments to maintain residential rates, to provide Internet access at
discounted rates to educational institutions and to not involuntarily
terminate employees.
Therefore, the Commission concluded that PRTA and GTE Holdings have met their
burden, and accordingly the Commission granted their applications for
transfer of control. In support of its conclusion, the Commission also noted
that this transaction has been approved by the legislature and Governor of
the Commonwealth of Puerto Rico, the duly elected representatives of the
people of Puerto Rico.
Action by the Commission, February 12, 1999, by Memorandum Opinion and Order
(FCC 99-22). Chairman Kennard, Commissioners Ness, Powell and Tristani with
Commissioner Furchtgott-Roth concurring and issuing a separate statement.
-FCC-
News Media contact: Meribeth McCarrick at 202-418-0654
Wireless Telecommunications Bureau contact: Jeffrey Steinberg at
202-418-0896
News media Information 202 / 418-0500
Fax-On-Demand 202 / 418-2830
Internet: http://www.fcc.gov
ftp.fcc.gov
Federal Communications Commission
1919 - M Street, N.W.
Washington, D. C. 20554
This is an unofficial announcement of Commission action. Release of the full text of a Commission order
constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).
News media Information 202 / 418-0500
Fax-On-Demand 202 / 418-2830
Internet: http://www.fcc.gov
ftp.fcc.gov
Federal Communications Commission
1919 - M Street, N.W.
Washington, D. C. 20554
This is an unofficial announcement of Commission action. Release of the full text of a Commission order
constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).
News media Information 202 / 418-0500
Fax-On-Demand 202 / 418-2830
Internet: http://www.fcc.gov
ftp.fcc.gov
Federal Communications Commission
1919 - M Street, N.W.
Washington, D. C. 20554
This is an unofficial announcement of Commission action. Release of the full text of a Commission order
constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).